Dutch national elections 2012 - the fifth elections in ten years - in full swing and counting the votes is nearly done.

The elections this year are as much a clincher as they were in 2010 (which I blissfully didn't cover). And again, the clincher is between the very two parties that smacked it out last time: Labour (PvdA) and the Freemarketistas of former prime-minister Mark Rutte (VVD).

Samsom (left) and Rutte hugging the cameras

Both parties have massively won - but during the course of the night it became clear that Rutte has bested the left yet again and with a historic victory. Never before the VVD party won so many seats.

But with a similarly large gain by the left, the two biggest parties are wedded to each other to attempt bridging their many, many differences. Further national lockdown looks not unreasonable.

I'll have a longer analysis below the fold.

Final version - Updated 13 September, 10:15 CET.

Relevant parties

My introductions in 2006 to the Dutch parties, left and right, have long become outdated. I'll resort to snappy one-liners instead.

VVD: Marketistas, led by the popular minister-president Mark Rutte.

PvdA: Labour, with freshly gilded leader Diederik Samsom, who has been moving the party away from the Third Way

PVV: Geert "Ban Burqa" Wilders. 'Nuff said.

CDA: Christian and Confused. Formed the coalition partner with VVD and Wilders last time  much to the chagrin of a third of its voters. Was left without a leader for nearly 1.5 years after Balkenende ran off to a better paying job.

SP: The real hard-left party in the Netherlands.

D66: Marketistas Lite, the most vocally pro-European party. It's leader, Alexander Pechtold, has manifested itself as one of the fiercest debaters of Wilders.

GroenLinks: Greens. Hopelessly ineffective.

ChristenUnie: More Christian than CDA. Always a mixed bag for progressives. More conservative on moral issues, harsh on European affairs, but not dumb on green policies and with a human perspective on the harsh Dutch asylum policy.

SGP: the Dutch Christian Taliban. Description from 2006 yet applies:

They are the oldest political party, have never been in the government and for as long as I remember are stuck with two to three seats in parliament. Perhaps they could have twice as many seats, if the party wasn't constantly proclaiming that women have no role in politics and shouldn't be entitled to vote. Most of their adherents come forth from the Dutch Bible Belt.

Partij voor de Dieren: On the breach for animal wellbeing wherever injustice is done. And apparently there is a lot.

50Plus: Elderly Party - another one issue party, angling (successfully) for the elder electorate that is increasingly afraid the kids on the lawn will eat all their benefits.

A first analysis:

Winner takes
Clearly, there are two winners and three big losers. PvdA and VVD both gain a significant amount of seats. It is the true battle between the ideologies this election, a classic left vs right struggle.

The Christian party CDA, Wilders' anti-democratic party and the Greens take the heaviest hits. CDA has been in the lurch ever since they started cooperating with Wilders and moving closer in policy to the VVD. Voters finally had enough and decided to vote for the real thing.

Wilders' vitriol on Europe either back-fired or, likelier, the defects in his party have begun to show for his voters. To what parties he has lost his voters, I don't know yet - but I suspect most to Rutte. He will get his favourite seat: opposition.

As for the Greens, a switch in leader and bad parliamentary decisions already had made them less popular. Internal party turmoil in the run-up to the elections did the rest.

With 15 won seats, a 'virtual' loser is the SP. The Socialist Party were ranking high in the polls, nearing 30, but eventually gained none of the seats which they lost in 2010. Much of the momentum was lost during the hard election scrum, partly because of the inexperience of their otherwise charismatic leader. At one point Labour's leader Samsom took over their spotlights, and catapulted his party as the one and only adversary of the popular liberals. The rest is history.

The Centre cannot Hold
The results look like a break with a trend of the past years. Since the rise of the popular Pim Fortuyn, the electorate went adrift, the traditional Dutch centre parties  comprised by the parties VVD, CDA and PvdA  went into gradual decline. The parties at the wings  left and right  profited instead. Hence the growth of the Socialists, Fortuyn and then Wilders across the years.

The 2012 elections marks a halt to that development at first glance. The Socialists lost heavily in 2010 and gained nothing back in these elections, and Wilders' party took a hammering this time. The flanks have actually grown slimmer the past two years.

But in fact, the PvdA and VVD parties have moved toward the flanks instead - while the actual centre party - CDA - got hammered yet again. Seen this ways, the process of splintering the electorate has stopped and we've moved to two main political streams - but the centre remains dying.

The VVD has grown even more business friendly under the direction of Rutte, while he has coupled it (insanely and irresponsibly) to an anti-European stance to drain voters from Wilders. Labour, with the rise of Samsom, has yanked the course hard left, moving back towards where the party originally came from. It's not spoken out loud, but Labour is busy leaving the Third Way.

It will remain to be seen if 1) VVD will loosen up on Europe and 2) how faithful Labour will stick to its new-found left course.

It takes two/three/four to tango ?
But these two parties  the ones that increasingly have diametrically opposed positions and policies  are now stuck with each other to form a coalition? It was feared that four to five parties were needed to weld a majority in Parliament of 76 seats. Now, we just need two. How old-fashioned.

If VVD and PvdA will negotiate -and this is now inevitable- they can either take the hard way, or the soft way. The soft way is that they compromise each other to death  and nothing will change, which would leave the Netherlands in the doldrums whilst the Euro-hurricane approaches unabated. A recipe for disaster, if you'd ask me.

And likewise, I dread the hard way. Which is that both parties sacrifice their core issues one at the time  sometimes left wins, the other time right wins. Some progress will be made, but Rutte is a tough negotiator and the Netherlands will likely remain stuck in the neoliberal rut if a deal is brokered. The danger for taking this route is that both parties will be decimated in the next elections by an increasingly disgruntled electorate.

In the end, with these vast differences to be bridged, there is a very real risk this outcome will lead the country into another lengthy period of forming into another unstable, inflammable government. Thus: a repeat of the past ten years.

It wouldn't surprise me that a third party will have to join to mend the two parties  if they can get mended in the first place. Firstly because VVD and Labour don't have the majority in the Senate. Secondly to have another party form the glue in this haphazard dance. But taking on a third party is likely more riskier for Samsom, than for Rutte.

Rather Rutte than Red
In my opinion, for whatever it's worth because my political astuteness leaves a lot to be desired, the growing division in the Netherlands slowly marches on. About half of the country, mostly middle-class, is enjoying the course set by Rutte, while the business and industry elites are taking their chances and gradually and inexorably are destroying the social fabric that was carefully built over 70 years. Yet many people still rather have Rutte. We've enjoyed extraordinary equality of income over the past years, but I would not be surprised that the coming years there will be a watershed.

The other half of the population is increasingly aware what is happening, but too few of them are yet convinced that Wilders hateful rhetoric won't bring the necessary solution. The Socialists have always been on the target with their message  and I'm still convinced they could've swayed many from the Wilders' party. But with the hint of victory in the air, they actually wavered and watered down their viewpoints, to curry favour with the other parties. It didn't work, and it gave them a bad rep. Bad mistake.

Whilst Labour is only halfway in rediscovering what matters socially and their victory may come yet too early  I'd wager at least half of the party remains conflicted and is unwilling to let go of the Third Way and the bonuses which bought so many of them.

And Greens? Environmental issues have moved further and further on the backseat in this ideological fray - even with a one seat gain for the Animal Party (still uncertain), the two greenest parties have been driven into the margin.

Perhaps it's my sleep-addled brain  but with these results heavy on the stomach, I don't see an easy solution for the Netherlands. We're still stuck in the Rut(te).

I wanted to know what happened to the Socialists' lead in the polls, and this diary dutifully answers the question already:

A 'virtual' loser is the SP. The Socialist Party were ranking high in the polls, but gained none of the seats which they lost in 2010. Much of their momentum they lost during the hard election scrum, partly because of the inexperience of their otherwise charismatic leader. At one point Labour's leader Samsom took over their spotlights, and catapulted his party as the one and only adversary of the popular liberals.

...

The other half of the population is increasingly aware what is happening, but too few of them are yet convinced that Wilders hateful rhetoric won't bring the necessary solution. The Socialists have always been on the target with their message - and I'm still convinced they could've swayed many from the Wilders' party. But with the hint of victory in the air, they actually wavered and watered down their viewpoints, to curry favour with the other parties. It didn't work, and it gave them a bad rep. Bad mistake.

If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa

About half of the country, mostly middle-class, is enjoying the course set by Rutte which is gradually and inexorably destroying the social fabric that was carefully built over 70 years. Yet many people still rather have Rutte. We've enjoyed extraordinary equality of income over the past years, but I would not be surprised that the coming years there will be a watershed.

The economics of I got mine, fuck you marches on...

If you are not convinced, try it on someone who has not been entirely debauched by economics. — Piero Sraffa

On face value, the high mortgage debt in the Netherlands should be a social issue. The mortgage debt is well offset by unusually high Dutch savings, and (more actual for lenders) big assets of pension funds. As unemployment is still rather low (though rising), the number of distressed borrowers is low as well - and no Laborist would particularly help them either. If you are a net lender, or still have a job, you can still be content in the Netherlands, even if your equity is dropping. Unspokenly, marketists take a good care of lenders.

In national accounting terms, the distinction is between primary income distribution, which is pre-tax, pre-transfer payment and secondary income distribution which is after taxes and transfer payments. In practice, this distinction makes sense only from the narrowest of administrative perspectives, due to the interpenetration of the private and public sectors in every mature industrial democracy.

Rhetorically, "distribute" is an irregular verb:
I distribute.
You re-distribute.
He gives your hard-earned money to lazy scroungers.

I've lost track on the definitions of 'growth' and 'austerity' - by politicians, by business-lobbyists and here at ET. I'll struggle on.

Labour's gambit in resisting the Dutch Austerity 2.0 package of past spring may have helped them. Then again, the minute the signatures were put to paper, the five parties that had grouped together began calling for changes and honing election rhetoric. And hardly anyone has mentioned the austerity package during the elections.

Labour has consistently resisted the three percent EU-budget ceiling, thereby risking an EU penalty. The party's program heckles the EU's insistence on 'growth', while rallying for a program for jobs instead. A Tobin tax, clear support for a large role of the ECB, Eurobonds, an absolve of liberalizing the health and housing market - it's all in there. Plenty of populist pipe-dreams are there as well (scrapping Strassbourg, reducing the EU budget) - but still. Labour has shifted relatively rapid towards the French negotiation position and the Dutch Socialists.

Combine this breed with the anti-EU, pro-austerity stance of Merkel's lapdog, Rutte, and what we'll get in the Netherlands is rather beyond speculation at this point - and somewhat frightening, might I add.

There was slight shift to the left, if you see CDA/PVV/VVD as the right and PvdA/SP/GL/D66 as the left. the gains of the VVD were slighter then the losses of PVV and CDA. On the other hands the gains of the PvdA and D66 were bigger then the losses of GL.

Still that gets you to ca. 44% left and 45% right. So power is hold by the parties neither clearly left or right: the christian and animal fundamentalists (SGB Christenunie and PvdD) and the new pensioners party.

So instead of cobbling a six party coalition were two parties are nuts, a two party government looks attractive.

And a PvdA-VVD-D66 coalition already existed. there is even a color name for them.

to the left is maximally 3 seats and most likely 2. In a parliament of 150 seats, that's a marginal 2 percent.

The smallest parties may eventually have some minor influence in course-correcting through parliament, but not in the formation of government, I'd wager. Had four to five parties been needed to form a majority, the smallest parties were (silently) hoping to plug the gap for considerable leverage. That scenario hasn't panned out.

Now the bigger parties need to muscle it out first. For coalition building, one should look at the medium-sized parties. The CDA, reduced to medium size, will think twice of being pulled into a coalition - but they love power, never say never. Greens are now too small and need cleaning up first.

Intuitively, D66 has the best cards to be eventually invited. But that would mean Samsom would have to make a deal with two Marketista parties, which would reduce his bargaining power.

Two reasons: One, to guarantee a majority in the Senate. Which is why CDA remains attractive as partner. Two, as a mediator between the two opposites. But number wise, PvdA and VVD can form a coalition without a third party involved.

And that's too bad imho. The problem is that the nominal center parties D66 and CDA would much rather make a coalition with the VVD. D66 has stated again and again that they would prefer a coalition with both labour and the VVD. Thereby giving them the power position in the center.